2012 Federal Deficit Tops $1 Trillion Again

The U.S. government deficit for fiscal year 2012 topped $1 trillion for the four consecutive year. The deficit actually fell 16% compared with the 2011 deficit and the budget ran a surplus of $75 billion in September, the final month of the federal fiscal year. That’s the largest monthly surplus since April 2008.

Federal spending in the 2012 fiscal year fell 2% to about $3.54 trillion and revenues rose 6%, including a boost of 16% in the amount paid in corporate taxes. Tax collections came in at $2.45 trillion, of which individuals paid $1.132 trillion and corporations paid $242.29 billion. The jump in corporate tax payments is due both to improved profits and the expiration of some deductions for business equipment purchases.

The deficit totaled $1.089 trillion in 2012 compared with $1.297 trillion in 2011.

The federal budget deficit plays a central role in the coming elections. Governor Romney would reduce the deficit by making what are revenue-neutral changes to the tax code and cutting spending. President Obama favors a mixture of tax increases and spending cuts.